On Thursday, the office of the New York Attorney General filed a lawsuit against the KuCoin crypto exchange, saying that the company marketed unregistered securities and commodities. According to the allegations made by NYAG in the lawsuit, the Seychelles-based KuCoin has been conducting business in New York without being registered as a securities and commodities broker-dealer.
NYAG Seeks To Block KuCoin
Despite the fact that KuCoin is not officially registered in the state of New York, the Office of the Attorney General (OAG) was able to buy and sell cryptocurrencies on the platform while residing in that state. By taking this legal action, Attorney General James intends to prevent KuCoin from conducting business in New York and to block access to the company’s website until it conforms with the law.
Read More: Bitcoin Price Drops Below $21K As Biden’s U.S. Budget Reveals Major Setback For Crypto
The lawsuit against KuCoin further alleges that the exchange’s native lending and staking product — commonly referred to as KuCoin Earn — is also an unregistered security offering. It’s interesting to note that NYAG’s filing previously labeled Ethereum (ETH) as a security, however, as per recent information, the statement has been amended and changed to “commodities”.
Growing Crypto Crackdowns
Crypto exchanges have been at the epicenter of recent regulatory crackdowns in the United States. Notable companies like as Kraken, Coinbase, CoinEx, and even Binance, the largest crypto trading platform in the world, have been targeted by U.S. authorities.
In a press release, the NYAG’s office was quoted as saying:
One by one my office is taking action against cryptocurrency companies that are brazenly disregarding our laws and putting investors at risk. Today’s action is the latest in our efforts to rein in shadowy cryptocurrency companies and bring order to the industry.
However, this isn’t the first time that KuCoin has clashed with regulators. The crypto exchange was charged by the Korean regulatory authorities in 2022 for engaging in “illegal business activities” without having the appropriate registration. In December of the last year, similar claims were made by the Dutch Central Bank, which alleged that the exchange was operating without a valid license.
In light of this news, the price of Kucoin Token fell by 1.24% in the past one hour in comparison to a 3% drop recorded over the last 24 hours. The KCS token is currently trading close to the $8 mark at the time of writing.
Also Read: Hedera Faces Network Issues Amid Growing Fears Of Hack; Is HBAR Price Set To Crash?
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
